In testimony in 1939 before a Standing Committee on Banking and Commerce of the Canadian Parliament when asked whether banks create money, he stated: “That is right. That is what they are for… That is the Banking business, just in the same way that a steel plant makes steel…The manufacturing process consists of making a pen-and-ink or typewriter entry on a card in a book. That is all…Each and every time a bank makes a loan (or purchases securities), new bank credit is created — new deposits — brand new money…As loans are debts, then under the present system all money is debt.”

1993 – LOBBY DAY ON MONETARY REFORM

Over 1000 people traveled to Washington D.C. and hand delivered petitions to the U.S. Congress calling for monetary reform. One of the authors of the measure was Byron Dale. Concerning debt, he stated: “Nobody can borrow themselves out of debt no more than you can drink yourself sober.”

1994 – CONGRESS PASSES RIEGLE ACT

The Riegle-Neal Interstate Banking and Branching Efficiency Act [IBBEA] amended the laws governing federally chartered banks. A provision of the Act officially ended the issuance of Greenbacks (US debt free currency first issued during the Civil War). “The [Treasury] Secretary shall not be required to reissue United State currency notes upon redemption.”

2008 – BANK BAILOUT BILL FAILS IN CONGRESS

The financial industry imploded in 2007 and 2008. The causes were primarily banking corporations engaging in incredibly risky loans (i.e. subprime mortgages) and too much leverage (loaning out many more times than actual assets – in some cases 30 times – called “fractional reserve” lending). The response was a call to bail out the largest financial corporations that had the greatest amount of toxic assets (called “zombie” banks). Secretary of the Treasury Hank Paulson, former head of Goldman Sachs financial corporation, on behalf of the Bush administration introduced a 3 page vague proposal asking for $700 billion to bail out the big banks. The public was outraged at what they rightly thought was a blank check bailout. Calls to Congress numbered more than 10:1 against the bill. Congress voted the act down.

2008 – U.S. STOCK MARKET CRASH

The Dow Jones plummeted by 778 points, its largest one-day drop in the history of the New York Stock Exchange. The short term cause of the crash was the congressional vote against the black check bank bailout. More fundamentally, it was result of the bursting of a massive housing “bubble” caused by financial institutions engaged in highly risky mortgages and other bizarre risky investments and fractional reserve lending. The elimination on controls of the financial industry a decade earlier opened the door, but was not the root cause, of the crash that has come to be known as the Great Recession. The root cause of the 2008 crash, similar to all other bursts of financial bubbles before it, was the ability of banks to issue money out of thin air as debt (loans) many times in excess of their assets. The smaller the asset base, the greater the risk that banks will go bankrupt when their loans cannot be repaid or other investments go bad.

SEPTEMBER 30

1941 – STATEMENT BY MARINER ECCLES, CHAIR OF THE FEDERAL RESERVE

Statement before the House Committee on Banking and Currency: “That is what our money system is. If there were no debts in our money system, there wouldn’t be any money.”

The people on the island of Yap in the Carolina Islands have for centuries used large, solid stone wheels as currency. The modern “civilized” world uses in a similar way gold or silver mined from the ground. The Yap money supply is the most stable in the world. It is controlled by the people and not by banking corporations.

1936 – DEATH OF LOUIS MCFADDEN (R- PA), CHAIRMAN OF THE US HOUSE BANKING AND CURRENCY COMMITTEE

“We have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks. Some people think the Federal Reserve Banks are U.S. government institutions. They are private credit monopolies; domestic swindlers, rich and predatory money lenders which prey upon the people the United States for the benefit of themselves and their foreign customers…The truth is the Federal Reserve Board has usurped the Government of the United States by the arrogant credit monopoly which operates the Federal Reserve Board.”

2014 – NATIONAL DAY IN CHINA The day commemorates the founding of the People’s Republic of China on October 1, 2014. The first paper money appeared in China about 806 AD.

OCTOBER 2

1869 – BIRTH OF MOHANDAS GANDHI

‘Earth provides enough to satisfy every man’s need, but not every man’s greed.” One of his “7 Deadly Sins” was “wealth without work.” He also said “[a] small body of determined spirits fired by an unquenchable faith in their mission can alter the course of history.”

“But why are we bailing out the Bank of China? Why are we bailing out the Saudi royal family?… The only way they can pass this bill is by creating and by sustaining a panic atmosphere… A few Members were even told that there would be martial law in America if we voted “no.”

OCTOBER 3

2008 – US CONGRESS APPROVES $700 BILLION BAILOUT FOR BANKS

Congress passes and President Bush signs into law the Emergency Economic Stabilization Act of 2008 (Public Law 110-343), which establishes the $700 billion Troubled Asset Relief Program (TARP). US taxpayers bailed out the largest US banks since they were considered “too big to fail.” Main Street businesses and side street homeowners facing foreclosures (due in large part to the speculative practices of major financial institutions) received no such support. Many of these major banks were major political campaign contributors/investors in the 2008 political campaign. The final bailout legislation was a revised and slightly better version of an original bill proposed by Sec. of Treasury Hank Paulson that was literally only a few pages in length. Massive public anger resulted in a flood of calls, emails and visits to congressional offices. Congress defeated the original proposal.

OCTOBER 4

1923 – BIRTH OF CHARLTON HESTON, ACTOR

“You shall not charge interest to your countrymen…” A quote from Moses from the Bible, [Deuteronomy 23: 19-20]. Moses was born sometime in 1527 BC. Since the exact date is unknown, why not use the birth date of the guy who played him in films!

OCTOBER 5

1941 – DEATH OF LOUIS BRANDEIS, US SUPREME COURT JUSTICE (1916-1939)

“The development of our financial oligarchy followed, in this respect, lines with which the history of political despotism has familiarized us: usurpation, proceeding by gradual encroachment rather than by violent acts; subtle and often long-concealed concentration of distinct functions, which are beneficent when separately administered, and dangerous only when combined in the same persons. It was by processes such as these that Cæsar Augustus became master of Rome. The makers of our own Constitution had in mind like dangers to our political liberty when they provided so carefully for the separation of governmental powers. . . . “The goose that lays golden eggs has been considered a most valuable possession. But even more profitable is the privilege of taking the golden eggs laid by somebody else’s goose. The investment bankers and their associates now enjoy that privilege. They control the people through the people’s own money.”

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Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt? Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice. This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis, Alice Francini, Deb Jose and Greg Coleridge helped in its development. Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com

We summarize last week’s activities; announce upcoming events for next week; and comment on the State of Ohio’s suit to the U.S. Supreme Court trying to prevent early voting; the new documentary, Pay 2 Play, about Ohio’s campaign finance scandals; declining economic conditions; the U.S. ponzi economy; too big too fail banks and their casino derivatives; and military actions in Iraq and Syria.

The Ohio Department of Education (ODE) recently released test results of schools statewide – both public and private. The results showed that public schools outperformed charter schools – again.

The ODE report showed that 228 out of 281 charter schools, many of them run by for-profit corporations, ranked in the bottom 25% academically, 93% of all charters ranked in the bottom 50%. Only 65% of students in charters passed the 3rd grade reading test, compared to 81% overall (the rate for public schools was 85%).

Charters took over $900 million directly out of school district budgets last year. Based on their enrollment, that came to $7500 per student. That compared to just shy of $3500 per student in public districts.

Charter students aren’t receiving a quality education. Taxpayers aren’t getting their money’s worth. Citizens aren’t aware of all that takes place in charters as the private corporate shield prevents many charters from being fully accountable for their activities.

The Electronic Classroom of Tomorrow (ECOT) is the largest charter school corporation in Ohio, in fact the 10th largest schools district in the entire state with a reported enrollment of 14,600. They received 7 F’s and 1 D in the ODE report. They continue to rank below all 8 large urban school districts in the state – the ones that we are told are disasters and should be “privatized.” ECOT’s 4-year graduation rate was 26% points lower than the infamous Cleveland public school district. Yet they received 100 million of our tax dollars last year alone. Two other private corporations owned by ECOT’s founder that provide management services to ECOT have shoveled in another $130 million since 2001, $22 million last year alone.

How could such a combined educational, financial and democracy disaster occur?

Political investments, what else.

William Lager is ECOT’s founder. He’s also a major political investor to Ohio Republican politicians. Lager has invested just over $2 million since 2001 in Ohio politicians to make sure his voice is heard – and inept educational corporations fully funded. Over the last 8 years, his political investments have averaged just short of $200,000 per year.

So let’s do the math. Lager’s corporations receive a combined $122,000,000 last year in our tax dollars. He politically invested $200,000. That’s a return of 610 times his investment. Not bad. Sure beats CD’s, even the Quantitative Easing-inflated stock market.

Mr. Lager, like many other CEOs of charter corporations, is making a ton of profit by supplying low quality service.

This couldn’t happen if political money was not constitutionally defined as “free speech” and corporations as “persons.” It’s just yet another reason for working to pass the We the PeopleConstitutional Amendment

1956 — DEATH OF FREDERICK SODDY, NOBEL LAUREATE
“It was recognized in Athens and Sparta…centuries before the birth of Christ that one of the most vital prerogatives of the State was the right to issue money.”
On money: “To allow it to become a source of revenue to private issuers is to create first, a secret and illicit arm of the government and last, a rival power strong enough ultimately to overthrow all other forms of government.”

1973 – HENRY KISSINGER SWORN IN AS 56TH US SECRETARY OF STATE
William Engdahl asserts in his introduction to Gods of Money that then-Secretary of State Henry Kissinger, a protégé of the powerful Rockefeller corporate empire, stated: “If you control the oil, you control entire nations; if you control the food, you control the people; if you control the money, you control the entire world.”

SEPTEMBER 23

1998 – TALK BY MICHAEL CHOSSUDOVSKY, PROFESSOR OF ECONOMICS
“Monetary policy is in the hands of private creditors who have the ability to freeze state budgets, paralyze the payments process, thwart the regular disbursement of wages to millions of workers and precipitate the collapse of production and social programs.”

SEPTEMBER 24

1976 – DEATH OF PAUL DOUGLAS, ECONOMIST, US SENATOR, QUAKER
A prominent University of Chicago economist, Douglas was one of several economists who developed A Program for Monetary Reform in 1939. It was sent to President Roosevelt as a proposal to end the Great Depression. More than 230 economists from 150 universities approved it without reservations while an additional 40 supported it with some reservations.
In assessing the problem of the day, the PMR states, “If the purpose of money and credit were to discourage the exchange of goods and services, to destroy periodically the wealth produced, to frustrate and trip those who work and save, our present monetary system would seem a most effective instrument to that end.” It also stated monetary systems based on a gold standard “has had…disastrous results all over the world.”
The PMR called for government creation and maintenance in the quantity of money. “Our own monetary policy should…be directed toward avoiding inflation as well as deflation, and in attaining and maintaining as nearly as possible, full production and employment.” The plan also called for eliminating fractional reserve lending – the process of banks loaning ourt many more times the amount of money in their possession. Back in the 1930’s the reserved requirement was 5:1. Today it’s 9:1. Some of the major banks involved in the economic collapse of 2007 had ignored this law and were loaning out 50 times their reserves. The PMR called for a 100% reserve requirement – banks could only lend the amount of money they possessed.
The document goes on, “In early times the creation of money was the sole privilege of the kings or other sovereigns – namely the sovereign people, acting through their Government. This principle is firmly anchored in our Constitution and it is a perversion to transfer the privilege to private parties to use in their own real or presumed interest. The founders of the Republic did not expect the banks to create the money they lend.
Their plan to reduce the national debt was simply to have the government purchase government bonds with new US debt-free money.
The PMR was the outgrowth of an earlier similar proposal from many of the same economists, The Chicago Plan, which was introduced as federal legislation in 1934, as a means to end the Great Depression The Chicago Plan called for the issuance of debt-free U.S. money and the end of banks lending less that their assets as means to reduce public and private debt, eliminate bank runs, and gain control over money creation.[NOTE: A new economic/mathematical analysis of the The Chicago Plan has been published The Chicago Plan Revisited is a working paper by two International Monetary Fund economists, Jaromir Benes and Michael Kumhoff. It affirms virtually every assertion by its advocates in the 1930’s. The paper is at http://www.stanford.edu/~kumhof/chicago-imfwp.pdf ]

SEPTEMBER 25

1913 – STATEMENT OF T. CUSHING DANIEL, US LEADING MONETARY SCHOLAR BEFORE SENATE BANKING AND CURRENCY COMMITTEE
“[I]t should be borned in mind that the value of the American dollar does not depend upon bankers or gold, but upon the National wealth of the United States created by the people.”

SEPTEMBER 26

1842 — BIRTH OF GEORGE ‘DIVING RIGHT’ BAER, PRESIDENT OF THE PHILADELPHIA & READING RAILROAD CORPORATION, WHICH WAS OWNED BY BANKER J.P. MORGAN
“The rights and interests of the laboring man will be protected and cared for, not by the labor agitators, but by the Christian men to whom God in His infinite wisdom has given the control of the property interests of the country, and upon the successful management of which so much depends”

1939 – DEATH OF ALFRED OWEN CROSIER, PROMINENT OHIO ATTORNEY AND AUTHOR
Crosier wrote widely against the power and influence held by Wall Street Bankers. Crozier wrote eight books, including The Magnet and U.S. Money vs. Corporation Currency, which warned the country of the replacement of the country’s currency by notes printed by private banking corporations. A wonderful display of political cartoons from his book, U.S. Money vs. Corporations Currency is at http://www.youtube.com/watch?v=q4qQ59w4ML4

1942 – STATEMENT OF REVERENT WILLIAM TEMPLE, ARCHBISHOP OF CANTERBURY, CALLING FOR THE NATIONALIZATION OF THE BANK OF ENGLAND
“The private issue of new credit should be regarded in the modern world in just the same way in which the private minting of money was regarded in earlier times. The banks should be limited in their lending power to the amount deposited by their clients, while the issue of newer credit should be the function of public authority. This is not in any way to censure the banks or bankers…But the system has become anomalous, and, so often happens when anomaly has persisted through a long period of time, the result is to make into the master what ought to be the servant.”
Temple’s advocacy for banks being “limited in their lending power to the amount deposited by their clients” was for the ending of “fractional reserve banking” – the common practice of financial institutions providing loans in amounts many times in excess of the actual amount held by them. This feature is one of the major components of HR 2990, The National Emergency Employment Defense Act.

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Why this calendar? Many people have questions about the root causes of our economic problems. Some questions involve money, banks and debt. How is money created? Why do banks control its quantity? How has the money system been used to liberate (not often) and oppress (most often) us? And how can the money system be “democratized” to rebuild our economy and society, create jobs and reduce debt? Our goal is to inform, intrigue and inspire through bite size weekly postings listing important events and quotes from prominent individuals (both past and present) on money, banking and how the money system can help people and the planet. We hope the sharing of bits of buried history will illuminate monetary and banking issues and empower you with others to create real economic and political justice. This calendar is a project of the Northeast Ohio American Friends Service Committee. Adele Looney, Phyllis Titus, Donna Schall, Leah Davis, Alice Francini, Deb Jose and Greg Coleridge helped in its development. Please forward this to others and encourage them to subscribe. To subscribe/unsubscribe or to comment on any entry, contact monetarycalendar@yahoo.com

We summarize last week’s activities; announce upcoming events for next week; and comment on the Senate vote on aconstitutional amendment to reverse Citizens United; Congressional support for bombing Syria and (yet again) Iraq; new figures on the growing rich-poor gap; several proposals for a wealth tax; increasing credit card debt; and a new state report documenting how Ohio public schools yet again outperform corporate charter schools.